Throughout the Detroit bankruptcy and the attendant speculation about what role, if any, the collection at the Detroit Institute of Arts that is owned by the city should play, a parallel parlor game has been to try to guess what Emergency Manager Kevyn Orr’s endgame and motivation really was. He has dropped hints about the importance of the collection in helping the city emerge from bankruptcy, but his plan of adjustment did not include any sales or loans with the collection as art. Rather, it included what has come to be called the “Grand Bargain,” under which several foundations will pledge hundreds of millions of dollars (as will the State of Michigan) to keep the art safe from liquidation.
This morning, however, the public got its first glimpse at what Orr really thinks about all this,when he testified at the ongoing trial. The Detroit Free Press has a live blog of the trial, which can be found here for timely updates and developments. Nathan Bomey has also been providing real time Tweets from inside the courtroom.
While there were reports this week that remaining Grand Bargain objector Financial Guaranty Insurance Corporation (FGIC) had reached a deal similar to the one that allowed Syncora Capital to step aside, nothing is final yet. And so Orr took to the stand, and said the following in response the questioning by Bankruptcy Court Judge Steven Rhodes, “”Why not monetize the art?”
Orr reportedly testified that he believes that a sale would harm the museum irreparably, spawn a legal battle that would take years to resolve (DIA has promised to fight any sales), and create a domino effect among donors and surrounding communities:
“In fact, my understanding is the endowment effort they’ve undertaken has taken a bit of a downfall as (donors) wait to see what happens,” he said.
As we’ve surmised, Orr’s hope all along in insisting that the collection play some role is the attempt to “some value I did not have at the beginning of this,” given that the Chapter 9 proceeding would not allow for any order to compel the city to sell the art against its wishes. “For me, that changed my perception of what was reasonable in terms of preserving a city asset and answering a question I’d always posed to the DIA and benefactors. We must have a solution to this problem and that provided a solution,” he reportedly testified. Asked by FGIC’s attorney if he had considered other ways to monetize the art, Orr said yes.
We may indeed look back on this as pulling a rabbit out of a hat, when all is said and done.